Title violations for Michigan Chevy dealership lead to suspension, then stay

UPDATED: 5/14/18 3:10 pm ET - adds lawyer"s response

A Michigan dealership was granted an emergency stay to continue buying, selling and trading vehicles despite a 15-day suspension it received last week based on customer complaints and numerous title-processing violations.

Patsy Lou Chevrolet, in Flint Township, Mich., operated by Patsy Lou Williamson and Ted Merrill Gans, was suspended from selling vehicles until May 25 due to violations in providing vehicle titles to buyers, Secretary of State Ruth Johnson said.

But on Friday, Genesee County Circuit Court Judge Geoffrey Neithercut ordered the secretary of state to allow the dealership to continue business until its appeal of the suspension can be heard.

No title after 2 months

The Department of State"s statement on Friday detailed a series of complaints received by customers against the dealership. In the most recent complaint, made in December 2016, a customer said she hadn"t received a title for her vehicle. An investigation found the buyer had not received the title after two months, and the paperwork submitted by the dealership after the sale "contained false information," the statement said.

The buyer was given a dealer plate in the interim as she was unable to provide a title and registration to get a license plate. Dealerships are to use dealer plates only for business purposes, the statement said.

"Despite multiple attempts to address the dealership"s violations without a suspension, the owner and the department were unable to reach an agreement, and Department of State staff then was forced to seek this penalty," Johnson said in a statement Friday. "Our duty is to protect consumers by holding dealers accountable for their actions. State law applies equally to all auto dealers, whether they"re small used-car lots or large new-vehicle dealerships. No dealer is above the law."

"We will be vindicated"

Michael Wais, the attorney representing Patsy Lou Chevrolet, told Automotive News he expects the dealership will stay open when the proceedings conclude.

"The Secretary of State took an unprecedented action in trying to shut the dealership down," Wais said. "We will be vindicated."

He also said the complaints are a miscommunication and that clients left a box unchecked on the paperwork, causing a paper filing issue but “no one was hurt.”

Fred Woodhams, spokesman for the secretary of state, told Automotive News on Monday that the department is continuing to pursue action for the violations.

"We look forward to seeing what the dealership says to contest the order, given it has already admitted to six of the 16 violations alleged by the department, and the hearing officer sided with the department on all but one," Woodhams said.

"As far as the stay, that order on Friday came as a surprise to the department," he said. "We believe once we have an opportunity to go before the court to present our evidence we will ultimately prevail."

Customers with similar experiences at the dealership were urged to call the Office of Investigative Services automotive complaint line.